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Leucadia National Corporation reported lackluster second-quarter 2017 results with net income of $58.2 million or 16 cents per share compared with $57.3 million or 15 cents per share in the year-ago quarter. The year-over-year increase in earnings was primarily driven by superior performance of Jefferies and National Beef. However, earnings missed the Zacks Consensus Estimate of 30 cents.
Leucadia National Corporation Price, Consensus and EPS Surprise
Total revenue for the reported quarter increased to $2,732.4 million from $2,625.4 million in the prior-year period due to solid organic growth. Revenues also exceeded the Zacks Consensus Estimate of $2,650 million.
Segmental Performance
In the reported quarter, Leucadia recorded an improved performance in the debt capital market, along with a solid contribution from equity capital markets, advisory activities and a favorable sales and trading environment. With significant margin contribution from National Beef and other businesses, Leucadia remains well positioned to grow.
During the quarter, Jefferies’ revenues improved to $781.7 million from $720.9 million in the year-earlier quarter while National Beef revenues increased to $1,875.5 million from $1,798.6 million. Revenues from Other Financial Services businesses including FXCM, HomeFed, Leucadia Asset Management, Berkadia and Foursight Capital significantly improved to $59.3 million from a negative return on investment of $14.1 million. Revenues from Other Merchant Banking businesses declined to $13.5 million from $109.4 million owing to lower industry-wide sales trends and a few underperforming stores of Garcadia. Corporate & Other segment revenues declined to $2,336 million from $10,492 million in the year-ago period.
Other Financial Details
During the reported quarter, Leucadia repurchased 1.2 million shares at an average price of $25.26 per share, bringing its share repurchase tally to 10.0 million shares over the past three years at an average price of $20.00 per share. Leucadia currently has 15 million shares remaining for repurchase.
The company also increased its quarterly dividend by 60% year over year to 10 cents per share.
Danaher has a long-term earnings growth expectation of 12.4%. It has a positive earnings surprise history with an average of 2.5% in the trailing four quarters, beating estimates in each.
Honeywell has a long-term earnings growth expectation of 9.5%. It has a positive earnings surprise history with an average of 2% in the trailing four quarters, beating estimates thrice.
ITT has a long-term earnings growth expectation of 13%. It has a positive earnings surprise history with an average of 8.2% in the trailing four quarters, beating estimates thrice.
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Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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Leucadia (LUK) Misses Q2 Earnings Estimates, Revenues Beat
Leucadia National Corporation reported lackluster second-quarter 2017 results with net income of $58.2 million or 16 cents per share compared with $57.3 million or 15 cents per share in the year-ago quarter. The year-over-year increase in earnings was primarily driven by superior performance of Jefferies and National Beef. However, earnings missed the Zacks Consensus Estimate of 30 cents.
Leucadia National Corporation Price, Consensus and EPS Surprise
Leucadia National Corporation Price, Consensus and EPS Surprise | Leucadia National Corporation Quote
Total revenue for the reported quarter increased to $2,732.4 million from $2,625.4 million in the prior-year period due to solid organic growth. Revenues also exceeded the Zacks Consensus Estimate of $2,650 million.
Segmental Performance
In the reported quarter, Leucadia recorded an improved performance in the debt capital market, along with a solid contribution from equity capital markets, advisory activities and a favorable sales and trading environment. With significant margin contribution from National Beef and other businesses, Leucadia remains well positioned to grow.
During the quarter, Jefferies’ revenues improved to $781.7 million from $720.9 million in the year-earlier quarter while National Beef revenues increased to $1,875.5 million from $1,798.6 million. Revenues from Other Financial Services businesses including FXCM, HomeFed, Leucadia Asset Management, Berkadia and Foursight Capital significantly improved to $59.3 million from a negative return on investment of $14.1 million. Revenues from Other Merchant Banking businesses declined to $13.5 million from $109.4 million owing to lower industry-wide sales trends and a few underperforming stores of Garcadia. Corporate & Other segment revenues declined to $2,336 million from $10,492 million in the year-ago period.
Other Financial Details
During the reported quarter, Leucadia repurchased 1.2 million shares at an average price of $25.26 per share, bringing its share repurchase tally to 10.0 million shares over the past three years at an average price of $20.00 per share. Leucadia currently has 15 million shares remaining for repurchase.
The company also increased its quarterly dividend by 60% year over year to 10 cents per share.
Moving Forward
Leucadia currently carries a Zacks Rank #4 (Sell). Some better-ranked stocks in the industry include Danaher Corporation (DHR - Free Report) , Honeywell International Inc. (HON - Free Report) and ITT Inc. (ITT - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Danaher has a long-term earnings growth expectation of 12.4%. It has a positive earnings surprise history with an average of 2.5% in the trailing four quarters, beating estimates in each.
Honeywell has a long-term earnings growth expectation of 9.5%. It has a positive earnings surprise history with an average of 2% in the trailing four quarters, beating estimates thrice.
ITT has a long-term earnings growth expectation of 13%. It has a positive earnings surprise history with an average of 8.2% in the trailing four quarters, beating estimates thrice.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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